Pricing Jobs Fairly: Finding the Balance

Pricing is hard. Too high loses work. Too low loses money. Here's how to find the right balance.

Understanding Your Costs

Direct Costs

• Materials for the specific job
• Consumables (blades, sandpaper, fixings)
• Subcontractor costs if applicable
• Skip hire, equipment rental

Overhead Costs

• Van costs (lease, fuel, insurance, maintenance)
• Tools and equipment (purchase, maintenance, replacement)
• Insurance (public liability, professional, van)
• Phone, accounting, software
• Training and certifications
• Marketing and website

Your Time

• Hours on the actual job
• Travel time
• Quote preparation
• Material sourcing
• Admin and paperwork

All of this needs to be covered by what you charge.

Calculating a Day Rate

Start with What You Need to Earn

What annual income do you need? Be realistic about living costs, savings, pension, tax.

Factor in Billable Days

You won't work every day. Account for:

• Holidays
• Sickness
• Quiet periods
• Admin days
• Training

Maybe 200-220 billable days per year is realistic.

Add Overheads

Total annual overheads divided by billable days = overhead per day.

Calculate Day Rate

Target income per day + overhead per day = minimum day rate.

Quoting a Job

Estimate Time Accurately

Be honest about how long it will take. Add contingency - things rarely go exactly to plan.

Price Materials Properly

Include a margin on materials. You're sourcing, transporting, and taking responsibility for them. 10-20% is reasonable.

Quote in Writing

Clear scope of what's included. Specify exclusions. State how variations will be handled.

Fixed Price vs Day Rate

Fixed Price

Customer knows exact cost. Risk is on you if it takes longer. Easier to sell. Requires accurate estimation.

Day Rate

Fair for uncertain scope. Risk is more shared. Some customers don't like open-ended cost. Better for complex or unpredictable work.

Hybrid Approach

Fixed price for defined work, day rate for discovered issues or variations.

Common Pricing Mistakes

Underpricing to Get Work

Wins jobs but loses money. Racing to the bottom hurts everyone. Compete on quality and service, not just price.

Not Accounting for All Costs

Forgetting overheads, travel time, or admin. Your quote only covers what you include.

Quoting Before Understanding Scope

Always see the job if possible. Photos don't show everything. Unexpected conditions cost money.

Not Managing Variations

"While you're here..." Either agree a new price or explain it's outside the quote.

Handling Price Queries

If a customer questions your price:

• Explain what's included
• Break down if helpful (labour, materials, etc.)
• Highlight quality and guarantees
• Don't apologise for fair pricing
• Be willing to walk away from jobs that don't work financially

The Right Price

The right price is one where:

• You earn a fair return for your skill and time
• The customer gets good value for quality work
• Your business remains sustainable

Don't undervalue your expertise. Quality tradespeople deserve fair compensation.